Dec. 26 (Bloomberg) -- Medifast Inc., a seller of weight-loss meals and counseling, declined the most in 16 months after
its acting chief financial officer said he would resign, six
weeks after the company’s prior CFO stepped down.

Medifast fell 13 percent to $25.50 at the close in New
York, for its biggest one-day decline since August 2011. The
Owings Mills, Maryland-based company said today in a regulatory
filing that Edward J. Powers would leave as acting CFO and
principal accounting officer no later than Jan. 4.

The CFO turnover and attention on the weight-loss company
Herbalife Ltd. unnerved Medifast investors, said Kurt Frederick,
a Wedbush Securities Inc. analyst in Los Angeles. Hedge-fund
manager Bill Ackman last week said he’s shorting shares of
Herbalife, after his research convinced him the maker of
nutritional supplements is a pyramid scheme. Frederick said the
situation for the two companies isn’t the same.

Medifast is “set up very differently from Herbalife,”
Frederick, who recommends buying Medifast shares, said in a
telephone interview. “The coaches don’t hold any inventory. The
compensation structure is different.”

While Powers’s departure was “unfortunate timing,” there
is no sign of deeper financial problems at Medifast, Frederick
said.

Other Interests

Medifast, which offers diet-plan meals and weight-loss
counseling, said Powers was leaving for a “job opportunity in
the construction tool industry,” in a statement released today.
Powers took over Nov. 13 after Medifast said former CFO Brendan
Connors had resigned “to pursue other interests.” The shares
have risen 86 percent so far this year.

Powers previously worked in the construction group of
Stanley Black & Decker Inc., the New Britain, Connecticut-based
tool maker, according to Medifast’s Nov. 13 statement. A
Medifast spokesman, Alecia Pulman, declined to say today where
Powers was going.

Joseph Kelleman, the company’s director of finance-supply
chain, will take over as CFO on an interim basis, the company
said in its statement. Medifast said it’s continuing a national
search for a permanent replacement.